Aviva Investors launches RDR-ready share classes

Aviva Investors has scrapped initial charges on its onshore open ended funds, as well as introducing commission-free share classes.

The asset manager has also introduced commission-free share classes through platforms with an annual management charge of between 0.15% and 1%.

The new ‘R’ share class on four of its Sicav funds, which is free from trail commission, is available on the Aviva Investors Global High Yield fund, the UK Equity Focus fund, the Global Convertibles fund and the Emerging Markets Local Currency Bond fund. This share class will only be offered if there is sufficient demand.

Aviva Investors sales director for UK Financial Institutions Jeremy Leadsom said the retail distribution review (RDR) was bringing about a shift in investors and advisers’ priorities.

‘We have been engaging with UK intermediaries and responding to their changing needs, and one of the steps we have taken is to review and adapt our share class and pricing models to meet the new environment for fee structures,’ he said. ‘We look forward to continuing to support advisers who are working to build successful and sustainable businesses in the UK.’

But not all asset managers have the same policy when it comes to commission-free share classes, and some have hefty minimum investment limits to access them.

Jupiter’s funds have a 1.5% annual management charge for direct business, reducing it to 0.75% on platform.

Artemis and Troy said they would not be reducing their annual management charges to take commission into account for direct business.

BlackRock’s clean share class, or ‘D’ share class, can only be accessed with a minimum £100,000 investment for direct business.

Baillie Gifford also requires a minimum investment of £10,000 for its clean share class in its Oeic funds off platform, but this cost is waived if received through an adviser, while Aberdeen and Cazenove said it would depend on the fund.

In our five-minute video series introducing new funds, Citywire’s head of investment research Jonathan Miller speaks to Aberdeen’s senior investment specialist Scott Dakers about the strategy and asset allocation of Aberdeen’s Multi Asset fund range, launched on the back of the new pension freedoms.

Matching up a broad cross-section of society with financial advice that fills their needs poses a challenge, but research suggest financial advisers are prepared to step in to help those with smaller sums to invest.

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